Personal loan interest rates: the lowest each lender publishes

What personal loan rates look like right now

Personal loan rates are personalised: a lender publishes a range and places you in it after checking your credit history, income and the loan you want. On 10 October 2026 the major banks' unsecured ranges ran from 6.99% p.a. (CommBank variable) to 22.25% p.a. (CommBank fixed), with Westpac at 7.29% to 22.19% and NAB at 7.50% to 22.00%.

The floor is not the typical price. Westpac publishes a median rate of 16.99% p.a. and says around half its customers get that or less; CommBank publishes a representative fixed rate of 16.25% p.a. A borrower with excellent credit, stable income and a modest loan can expect the bottom of a range; most applicants land in the middle.

Secured loans are priced lower, and the difference is mostly at the top. CommBank's secured car loan runs 6.79% to 11.29% p.a., only half a point below its unsecured floor at the bottom but 11 points below its unsecured ceiling at the top.

Factors That Affect Your Personal Loan Rate

Understanding what drives your personal loan rate helps you take steps to improve it. The following factors have the greatest impact on the rate a lender will offer you.

Credit Score

Your credit score is arguably the single most important factor. Moneysmart lists two main credit reporting bodies in Australia, Equifax and Experian, and scores run from zero to 1,000 or 1,200 depending on the body. A higher score gets you closer to the bottom of a lender's range; a low score pushes you towards the top or to a decline. You can get your credit report free every three months.

Factors that affect your credit score include your repayment history (the most heavily weighted factor), the number of credit enquiries on your file, any defaults or court judgments, the length of your credit history, and your overall credit utilisation. Checking your own credit score does not affect it, only applications to lenders generate hard enquiries.

Secured vs Unsecured

Offering security (collateral) reduces the lender's risk and results in a lower rate. Common forms of security for personal loans include motor vehicles, term deposits, shares or managed funds, and in some cases, residential property. The published ranges show where the saving is: CommBank's secured car loan tops out at 11.29% p.a. against 22.25% p.a. unsecured, and NAB's at 13.54% p.a. against 22.00% p.a.

The trade-off is that if you default on a secured loan, the lender can seize and sell the asset to recover their funds. For this reason, unsecured loans are preferred by borrowers who either do not have suitable assets to offer or who do not want to put their assets at risk. The convenience and simplicity of unsecured loans also appeals to many borrowers despite the higher rate.

Fixed vs Variable Rates

Most personal loans in Australia are offered at a fixed rate, meaning the rate and repayment amount stay the same for the entire loan term. This provides certainty and makes budgeting straightforward. Fixed rates are particularly popular for personal loans because the shorter loan terms (typically two to seven years) mean less exposure to rate fluctuations.

Variable rate personal loans are less common but can start lower: CommBank's variable range begins at 6.99% p.a. against 7.25% p.a. fixed. The rate can then rise or fall during the term. Variable loans usually allow extra repayments without a fee, which suits a borrower planning to pay the loan off early.

How to Get the Best Personal Loan Rate

Securing the lowest possible rate requires preparation and strategy. Here are the most effective steps you can take before applying:

• Check your credit score first: Request your free credit report from Equifax and Experian. Fix any errors (incorrect defaults, wrong addresses) before applying, as these can drag your score down unnecessarily.
• Pay down existing debt: Reducing your credit card balances and closing unused credit accounts lowers your debt-to-income ratio, which improves your attractiveness to lenders and can result in a lower rate.
• Offer security if possible: Even if you initially consider an unsecured loan, check whether offering a vehicle or other asset as security would bring your rate down. On $30,000 over five years, the difference between 11.29% and 22.25% p.a. is about $176 a month.
• Avoid multiple applications: Each loan application creates a credit enquiry that can reduce your score. Instead of applying to multiple lenders, use a broker who can assess your options with a single enquiry.
• Demonstrate stable income: Lenders offer better rates to borrowers with stable employment. If possible, wait until you have been in your current role for at least six months before applying.
• Use your existing bank: Some banks price their own customers better. NAB publishes 7.50% to 12.99% p.a. (8.54% to 13.96% comparison) on unsecured loans for its home loan customers, against 7.50% to 22.00% p.a. for everyone else, and CommBank gives a customer with an active CommBank home loan its lowest advertised rate on an eligible unsecured loan for renovations or home improvements.
• Borrow only what you need: Larger loans relative to your income can attract higher rates. Borrow only the amount you need and can comfortably repay.

What Lenders Look For

Understanding the lender's assessment criteria helps you present the strongest possible application. Lenders evaluate your creditworthiness using a combination of automated scoring and manual review. The key factors they consider include:

Income and employment

Lenders want to see stable, verifiable income sufficient to cover the loan repayments alongside your existing commitments. PAYG employees with permanent positions are viewed most favourably. Casual, contract, and self-employed applicants may face additional scrutiny but can still access competitive rates with the right documentation.

Living expenses

Under responsible lending obligations, lenders must assess that you can afford the loan without financial hardship. They review your bank statements to understand your spending patterns and compare your declared expenses against the Household Expenditure Measure (HEM) or their own benchmarks.

Existing debts

The total of your existing debt repayments (including the proposed new loan) must fall within the lender's acceptable debt-to-income ratio. Credit card limits, not just balances, are included in this calculation. Reducing limits or closing unused cards before applying can improve your assessment.

Loan purpose

Lenders assess the purpose of the loan as part of their risk evaluation. Loans for asset purchases (cars, home improvements) are generally viewed more favourably than loans for discretionary spending (holidays, weddings), and a loan secured against the car being bought is priced lowest of all.

Comparison of Personal Loan Types

Choosing the right type of personal loan is just as important as finding a low rate. Each type has different features, rates, and suitability depending on your needs:

• Secured fixed rate: The lowest rate ceilings. Best for borrowers who have an asset to offer as security and want certainty of repayments. See secured personal loans.
• Unsecured fixed rate: Higher rates but no asset risk. Suits borrowers who want simplicity and do not have a suitable asset to secure the loan against. See unsecured personal loans.
• Debt consolidation loans: Designed to combine multiple debts into one. The benefit comes from a lower overall rate than your existing debts and a fixed end date. See debt consolidation loans.
• Green and EV loans: Some lenders discount loans for electric vehicles and energy upgrades. NAB publishes a 0.75% EV rate discount on its car loans, and CommBank a special 5.79% p.a. rate (7.21% comparison) on its secured car loan for eligible essential workers or people earning under $100,000 who buy an eligible electric or plug-in hybrid car up to $55,000.
• Line of credit: A flexible facility that lets you draw down and repay as needed, up to a pre-approved limit. Interest is charged only on the amount drawn. Best for ongoing or uncertain funding needs, but rates tend to be higher than term loans.